Ausbil’s chief investment officer, Paul Xiradis, has drawn attention from rival investors following his significant pre-IPO investment in Firmus, a data centre company founded by Oliver Curtis and Tim Rosenfield. This move raised eyebrows given Ausbil’s substantial $22 billion under management and Xiradis’s personal acquisition of shares in the same venture. Such individual investments are increasingly scrutinised by conflict-averse fund managers, who typically channel personal capital into their own managed funds.
The decision is creating internal reverberations at Ausbil, particularly concerning the valuation of its Firmus holdings, which are distributed across multiple funds but predominantly in the flagship Australian Active Equity Fund. Managed by Xiradis, this fund is almost entirely composed of listed blue-chip companies, making the unlisted Firmus a notable outlier. While Ausbil’s September update highlighted Firmus as an overweight position, its unlisted status poses challenges for marking its value, critical for overall fund performance. The fund’s product disclosure statement allows for investments in “unlisted companies which are expected to be listed,” a criterion Xiradis initially anticipated for Firmus.
Compounding these valuation complexities, Ausbil has experienced recent personnel shifts and strategic changes. Small-cap specialist Tom Cutler departed for Ophir Asset Management, followed by portfolio manager Andrew Peros joining L1 Capital in August. Last week, Ausbil chief executive Mark Knight announced the complete closure of its $27 million long-short focus fund, leading to the departures of deputy head of equities Gian Pandit and co-portfolio manager Chris Smith, the latter also being Ausbil’s head of research. Within the fund management community, some speculate these personnel movements are linked to internal discussions regarding Xiradis’s Firmus investment and its disclosure, with queries reportedly reaching Ausbil’s parent company, New York Life.
The challenge of accurately valuing Firmus shares remains a pressing topic among fund managers. Xiradis faces heightened pressure, particularly if the valuation of his personal holding differs from that of Ausbil’s substantial stake in the data centre company.
